Impact of Macroeconomic Factors on IPO Activity
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- Master of Science 
This thesis aims to examine the relationship between macroeconomic factors and IPO activity in the euro area from January 2000 to December 2022. By employing the Johansen test for cointegration, our analysis found evidence of two long-run equilibrium relationships between the macroeconomic factors and IPO activity. Moreover, the short- and long-run dynamics were examined using the Vector Error Correction model. Furthermore, variance decomposition and impulse response functions were applied to improve our understanding of the relative importance of shocks and the response patterns within the system. Eventually, the Granger causality test was employed to determine any potential causal relationship between the variables. Notably, our findings confirm a significant positive relationship between the stock market and IPO activity. However, we encountered limited statistical evidence to support a relationship between the long-term interest rate, industrial production, and market volatility, and IPO activity. Although market volatility demonstrates a closer connection to IPO activity compared to the longterm interest rate and industrial production, the statistical support for this relationship remains relatively weak.
Masteroppgave(MSc) in Master of Science in Business, Finance - Handelshøyskolen BI, 2023